To amend the Fair Credit Reporting Act to make improvements to the regulation of consumer reporting agencies and protect consumers, and for other purposes.

I 116TH CONGRESS 1ST SESSION H. R. 3821 To amend the Fair Credit Reporting Act to make improvements to the regulation of consumer reporting agencies and protect consumers, and for other purposes. IN THE HOUSE OF REPRESENTATIVES JULY 18, 2019 Mr. MCHENRY introduced the following bill; which was referred to the Committee on Financial Services A BILL To amend the Fair Credit Reporting Act to make improve- ments to the regulation of consumer reporting agencies and protect consumers, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. CYBERSECURITY SUPERVISION AND EXAMINA- 3 TION OF LARGE CONSUMER REPORTING 4 AGENCIES. 5 (a) IN GENERAL.—The Fair Credit Reporting Act 6 (15 U.S.C. 1681 et seq.) is amended by adding at the end 7 the following: 8 VerDate Sep 11 2014 22:12 Jul 27, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H3821.IH H3821 pamtmann on DSKBFK8HB2PROD with BILLS 2 •HR 3821 IH ‘‘SEC. 630. CYBERSECURITY SUPERVISION AND EXAMINA- 1 TION OF LARGE CONSUMER REPORTING 2 AGENCIES. 3 ‘‘Consumer reporting agencies described under sec- 4 tion 603(p) shall be subject to cybersecurity supervision 5 and examination by the Bureau.’’. 6 (b) CLERICAL AMENDMENT.—The table of contents 7 of the Fair Credit Reporting Act is amended by adding 8 at the end the following: 9 ‘‘630. Cybersecurity supervision and examination of large consumer reporting agencies.’’. SEC. 2. PROHIBITION ON THE USE OF SOCIAL SECURITY 10 NUMBERS. 11 (a) IN GENERAL.—Section 605 of the Fair Credit 12 Reporting Act (15 U.S.C. 1681c) is amended by adding 13 at the end the following: 14 ‘‘(i) PROHIBITION ON THE USE OF SOCIAL SECURITY 15 NUMBERS.—A consumer reporting agency described 16 under section 603(p)— 17 ‘‘(1) may not make any consumer report con- 18 taining a social security number; and 19 ‘‘(2) may not use the social security number of 20 a consumer as a method to verify the consumer.’’. 21 (b) CONFORMING AMENDMENT.—Section 609(a)(1) 22 of the Fair Credit Reporting Act (15 U.S.C. 1681g(a)(1)) 23 is amended by striking ‘‘except that—’’ and all that fol- 24 VerDate Sep 11 2014 22:12 Jul 27, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H3821.IH H3821 pamtmann on DSKBFK8HB2PROD with BILLS 3 •HR 3821 IH lows through ‘‘(B) nothing’’ and inserting ‘‘except that 1 nothing’’. 2 (c) EFFECTIVE DATE.—The amendments made by 3 this section shall take effect on January 1, 2020. 4 SEC. 3. EXCLUSION OF PAID MEDICAL DEBT. 5 Section 605(a) of the Fair Credit Reporting Act (15 6 U.S.C. 1681c(a)) is amended, by adding at the end the 7 following: 8 ‘‘(9) Paid debt arising from the receipt of medi- 9 cally necessary, non-elective medical services, prod- 10 ucts, or devices which from the date of payment, 11 antedate the report by more than 1 year.’’. 12 SEC. 4. SECURITY FREEZES FOR PROTECTED CONSUMERS. 13 (a) PLACEMENT OF FREEZE.—Section 605A(j)(2)(A) 14 of the Fair Credit Reporting Act (15 U.S.C. 1681c– 15 1(j)(2)(A)) is amended to read as follows: 16 ‘‘(A) IN GENERAL.—Upon receiving a di- 17 rect request from a protected consumer’s rep- 18 resentative, by mail, toll-free telephone, or se- 19 cure electronic means, that a consumer report- 20 ing agency place a security freeze, and upon re- 21 ceiving sufficient proof of identification and suf- 22 ficient proof of authority, the consumer report- 23 ing agency shall, free of charge, place the secu- 24 rity freeze not later than 3 business days after 25 VerDate Sep 11 2014 22:12 Jul 27, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H3821.IH H3821 pamtmann on DSKBFK8HB2PROD with BILLS 4 •HR 3821 IH receiving the request directly from the protected 1 consumer’s representative.’’. 2 (b) REMOVAL OF FREEZE.—Section 605A(j)(4) of 3 the Fair Credit Reporting Act (15 U.S.C. 1681c–1(j)(4)) 4 is amended— 5 (1) in subparagraph (A)(i), by inserting after 6 ‘‘Upon the direct request’’ the following: ‘‘, by mail 7 or secure electronic means,’’; 8 (2) in subparagraph (A)(ii), by inserting after 9 ‘‘Upon the direct request’’ the following: ‘‘, by mail 10 or secure electronic means,’’; and 11 (3) in subparagraph (C)— 12 (A) by striking ‘‘not later than—’’ and in- 13 serting the ‘‘not later than 3 days business days 14 after receiving the request directly from the 15 protected consumer or protected consumer’s 16 representative.’’; and 17 (B) by striking clauses (i) and (ii). 18 SEC. 5. PUBLIC RECORD DATA SOURCES IN CONSUMER RE- 19 PORTS. 20 Section 605(d) of the Fair Credit Reporting Act (15 21 U.S.C. 1681c(d)) is amended by adding at the end the 22 following: 23 ‘‘(3) PUBLIC RECORD DATA.—If a consumer re- 24 porting agency furnishes a consumer report that 25 VerDate Sep 11 2014 22:12 Jul 27, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H3821.IH H3821 pamtmann on DSKBFK8HB2PROD with BILLS 5 •HR 3821 IH contains public record data, such consumer reporting 1 agency shall include the source of such public record 2 data in such report.’’. 3 SEC. 6. PROHIBITION ON INCLUDING ADVERSE INFORMA- 4 TION RELATED TO PREDATORY MORTGAGE 5 LENDING. 6 (a) IN GENERAL.—The Fair Credit Reporting Act 7 (15 U.S.C. 1681 et seq.) is amended by inserting after 8 section 605B the following: 9 ‘‘§ 605C. Adverse information relating to predatory 10 mortgage lending 11 ‘‘(a) IN GENERAL.—A consumer reporting agency 12 may not furnish any consumer report containing any ad- 13 verse item of information relating to a covered residential 14 mortgage loan (including the origination and servicing of 15 such a loan, any loss mitigation activities related to such 16 a loan, and any foreclosure, deed in lieu of foreclosure, 17 or short sale related to such a loan), if the action or inac- 18 tion to which the item of information relates— 19 ‘‘(1) resulted from an unfair, deceptive, or abu- 20 sive act or practice, or a fraudulent, discriminatory, 21 or illegal activity of a financial institution, as deter- 22 mined by a court of competent jurisdiction; or 23 ‘‘(2) is related to an unfair, deceptive, or abu- 24 sive act or practice, or a fraudulent, discriminatory, 25 VerDate Sep 11 2014 22:12 Jul 27, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H3821.IH H3821 pamtmann on DSKBFK8HB2PROD with BILLS 6 •HR 3821 IH or illegal activity of a financial institution that is the 1 subject of a settlement agreement initiated on behalf 2 of a consumer and that is between the financial in- 3 stitution and an agency or department of a local, 4 State, or Federal Government. 5 ‘‘(b) COVERED RESIDENTIAL MORTGAGE.—In this 6 section, the term ‘covered residential mortgage loan’ 7 means any loan made primarily for personal, family, or 8 household use that is secured by a mortgage, deed of trust, 9 or other equivalent consensual security interest on a dwell- 10 ing (as defined in section 103(w) of the Truth in Lending 11 Act), including a loan in which the proceeds will be used 12 for— 13 ‘‘(1) a manufactured home (as defined in sec- 14 tion 603 of the Housing and Community Develop- 15 ment Act of 1974); 16 ‘‘(2) any installment sales contract, land con- 17 tract, or contract for deed on a residential property; 18 or 19 ‘‘(3) a reverse mortgage transaction (as defined 20 in section 103(cc) of the Truth in Lending Act).’’. 21 (b) TABLE OF CONTENTS AMENDMENT.—The table 22 of contents of the Fair Credit Reporting Act is amended 23 by inserting after the item relating to section 605B the 24 following new item: 25 ‘‘605C. Adverse information relating to predatory mortgage lending.’’. VerDate Sep 11 2014 22:12 Jul 27, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6211 E:\BILLS\H3821.IH H3821 pamtmann on DSKBFK8HB2PROD with BILLS 7 •HR 3821 IH SEC. 7. PROHIBITION ON INCLUDING ADVERSE INFORMA- 1 TION WHEN FINANCIAL ABUSE HAS BEEN DE- 2 TERMINED. 3 (a) IN GENERAL.—The Fair Credit Reporting Act 4 (15 U.S.C. 1681 et seq.), as amended by section 6, is fur- 5 ther amended by inserting after section 605C the fol- 6 lowing: 7 ‘‘§ 605D. Adverse information in cases of financial 8 abuse 9 ‘‘A consumer reporting agency may not furnish a con- 10 sumer report containing any adverse item of information 11 about a consumer that resulted from intentionally abusive 12 or harmful financial behavior if— 13 ‘‘(1) a court of competent jurisdiction, in a law- 14 suit that is not a class action lawsuit, has deter- 15 mined that the consumer is a victim of such inten- 16 tionally abusive or harmful financial behavior; 17 ‘‘(2) such intentionally abusive or harmful fi- 18 nancial behavior was conducted by a spouse, family 19 or household member, caregiver, or person with 20 whom such consumer had a dating relationship; and 21 ‘‘(3) such consumer did not participate in or 22 consent to such behavior.’’. 23 (b) TABLE OF CONTENTS AMENDMENT.—The table 24 of contents of the Fair Credit Reporting Act is amended 25 VerDate Sep 11 2014 22:12 Jul 27, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H3821.IH H3821 pamtmann on DSKBFK8HB2PROD with BILLS 8 •HR 3821 IH by inserting after the item relating to section 605C the 1 following new item: 2 ‘‘605D. Adverse information in cases of financial abuse.’’. SEC. 8. PROHIBITION ON INCLUDING ADVERSE INFORMA- 3 TION WHEN A STUDENT OBLIGOR IS DE- 4 FRAUDED. 5 (a) IN GENERAL.—The Fair Credit Reporting Act 6 (15 U.S.C. 1681 et seq.), as amended by section 7, is fur- 7 ther amended by inserting after section 605D the fol- 8 lowing: 9 ‘‘§ 605E. Adverse information in cases of a defrauded 10 student obligor. 11 ‘‘(b) IN GENERAL.—A consumer reporting agency 12 may not furnish a consumer report containing any adverse 13 item of information about a consumer that resulted from 14 a private student loan obligation if— 15 ‘‘(1) such consumer is a student obligor with 16 respect to such private education loan; and 17 ‘‘(2) a court of competent jurisdiction, in a law- 18 suit that is not a class action lawsuit, has deter- 19 mined that such consumer is a victim of fraud with 20 respect to such private education loan. 21 ‘‘(c) PRIVATE EDUCATION LOAN DEFINED.—For the 22 purposes of this section, the term ‘private education loan’ 23 has the meaning given the term in section in section 24 140(a) of the Truth in Lending Act.’’. 25 VerDate Sep 11 2014 22:12 Jul 27, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H3821.IH H3821 pamtmann on DSKBFK8HB2PROD with BILLS 9 •HR 3821 IH (b) TABLE OF CONTENTS AMENDMENT.—The table 1 of contents of the Fair Credit Reporting Act is amended 2 by inserting after the item relating to section 605D the 3 following new item: 4 ‘‘605E. Adverse information in cases of a defrauded student obligor.’’. SEC. 9. BUREAU LIST OF CREDIT REPORTING AGENCIES. 5 The Bureau of Consumer Financial Protection shall 6 maintain a list of credit reporting agencies in the United 7 States and publish such list of the website on the Bureau 8 of Consumer Financial Protection. 9 SEC. 10. STUDY AND REPORT TO CONGRESS ON USE OF 10 NON-TRADITIONAL DATA IN CREDIT SCOR- 11 ING. 12 (a) STUDY.—The Bureau of Consumer Financial 13 Protection shall carry out a study about the use of non- 14 traditional data— 15 (1) by consumer reporting agencies when com- 16 piling and furnishing consumer reports; and 17 (2) by persons that create, maintain, or pur- 18 chase credit scoring models used in making credit 19 decisions. 20 (b) REPORT.—Not later than 18 months after the 21 date of the enactment of this section, the Bureau of Con- 22 sumer Financial Protection shall issue a report to the 23 Committee on Financial Services of the House of Rep- 24 resentatives and the Committee on Banking, Housing, and 25 VerDate Sep 11 2014 22:12 Jul 27, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H3821.IH H3821 pamtmann on DSKBFK8HB2PROD with BILLS 10 •HR 3821 IH Urban Affairs of the Senate containing all findings and 1 determinations, including any recommendations for any 2 legislative or regulatory changes, made in carrying out the 3 study required under subsection (a). 4 (c) DEFINITIONS.—For the purposes of this section, 5 the terms ‘‘consumer reporting agency’’ and ‘‘consumer 6 report’’ shall have the meanings given the terms in section 7 603 of the Fair Credit Reporting Act. 8 Æ VerDate Sep 11 2014 22:12 Jul 27, 2019 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6301 E:\BILLS\H3821.IH H3821 pamtmann on DSKBFK8HB2PROD with BILLS